Professional Documents
Culture Documents
Giving in India1 PDF
Giving in India1 PDF
Introduction 2
Background 2
Purpose 2
Process 3
Main findings 3
Next steps 4
A note on terminology 5
1. The problem and solution 6
The problem 6
The solution 14
2. Developing a framework 19
Factors in giving 19
Internal variables 19
External variables 21
Where does this leave us? 30
3. Water and sanitation 31
Stage 1: Needs 31
Stage 2: What works? 37
Stage 3: Government and other funders 42
Stage 4: Voluntary sector 48
Lessons for donors 53
Conclusions 57
Acknowledgements 58
References 60
1
Introduction
Background all of its reports freely available on its website
(www.philanthropycapital.org) and uses this
This report looks at the nature and role of research to provide strategic consultancy and
philanthropy in India, and explores ways to advice to funders and charities.
increase its impact. It grew out of the premise
In March 2008, NPC produced the report
that private giving in India has considerable
Philanthropists without borders, which
potential to tackle the country’s entrenched
highlighted the challenges facing philanthropists
problems, and money is not being allocated as
working internationally, and explored NPC’s
effectively as possible.
potential international strategy.1 Based on
With its roots in religious giving, philanthropy in extensive interviews and focus groups with
India has long tended to mean donors funding international donors, it showed significant
temples and schools in their villages of origin. demand for independent advice on how to give
This kind of activity is laudable but it can only effectively. This was mirrored by growing ad hoc
be a modest step towards tackling India’s demand from funders, other intermediaries and
challenges. It is the contention of this report that NGOs, asking NPC to apply its methodology to
donors need to think more strategically about the international voluntary sector.
the best use of their philanthropy.
Copal Partners (Copal) is a financial research
This report argues that giving in India needs to and consultancy firm that has its main office
improve and can be made more effective. The in Delhi. It started its own charity analysis
Indian voluntary sector is large, including over team in 2006, in response to demand from its
1.2 million non-governmental organisations clients for advice on their philanthropy. These
(NGOs). Within this, certain issues should be clients included banks, other corporations and
prioritised and charities chosen on the basis high net worth individuals. This development
of their outcomes. This will ensure that private also reflected Copal’s senior management’s
funding has a greater impact on people’s lives own philanthropic interest in improving the
in India. effectiveness of the Indian voluntary sector. The
team has produced an overview of the Indian
Underpinning this work is research from a year- charity sector, as well as analysis of several
long joint venture between New Philanthropy of the larger NGOs in India, such as HelpAge
Capital (NPC), a London-based NGO India and the Children in Need Institute. All of
specialising in improving the effectiveness of these reports are available on Copal’s website,
the voluntary sector, and Copal Partners, a www.copalpartners.com.
leading provider of financial analytics, business
intelligence and research services. In March 2008, NPC and Copal decided to pool
their efforts and set up a joint venture to explore
NPC was set up in 2002 to improve the the effectiveness of philanthropy in India. The
effectiveness of the voluntary sector in the UK. aim was to draw on the skills of both partners,
It was founded by philanthropists from the and contribute to a growing debate on the
financial services industry who felt that too little effectiveness of the Indian voluntary sector.
information was available on charity impact and
on effective funding. They decided to found an Purpose
independent charity to provide an objective and
analytical perspective on the role and priorities The purpose of this report is to explore the
for private giving. current status of philanthropy in India and to
test ways of using and synthesising available
NPC has developed a tailored methodology for information to improve its effectiveness. This
analysing social issues, identifying priorities for builds on NPC and Copal’s previous experience
philanthropy and judging the effectiveness of of voluntary sector analysis, and looks to
individual NGOs. In the past seven years it has transfer NPC’s methodology and approach to
applied this approach to over 20 social issues the Indian context. This ‘core’ methodology is
in the UK, including homelessness, autism and set out in Funding success, which is available
ex-offenders. It also carries out cutting-edge at www.philanthropycapital.org.2 An update to
analysis of general voluntary sector issues, this report will be launched in the second half
such as governance, effective grant-giving of 2009.
and results measurement tools. NPC makes
2
Giving in India I Introduction
This report explores four main hypotheses: 3. Telephone calls with a shortlist of NGOs,
selected on the basis of their potential;
• Funding for NGOs in India is not working
properly—there is a ‘funding market’ linking 4. Field visits to a sample of NGOs (20–30),
funders and charities, but it is in important including in-depth interviews with
senses ‘broken’. management; and
• Analysing social issues and individual NGOs 5. In-depth analysis of four to six high-
can help fix this broken market. performing NGOs.
• Using NPC and Copal’s analytical The whole year’s research has fed into this
framework, donors can prioritise issues report and its understanding of the voluntary We hope that by
and philanthropy sector in India. However,
and NGOs for funding based on analysis of
the findings specific to the research on early
demonstrating
potential impact.
Introduction
childhood development are being published as the potential
• It is possible to do in-depth analysis of a separate report, Starting strong. The analysis
NGOs in India. of the water and sanitation sector is included
benefits of using
The information and framework set out in in this report. It is presented as an example an analytical
of how to use an analytical framework to
this report are presented as useful tools for
foundations and donors who are new to giving understand a particular social issue, prioritise framework on
in India. Using these tools can help structure issues for donors, and provide a context for voluntary sector
and inform their giving. NGOs can also draw the analysis of individual NGOs.
upon the information in the report to think about
effectiveness,
their role in the sector, and how to improve their Main findings more
activities and impact measurement.
This report is divided into three parts, each of organisations
Beyond this, NPC and Copal aim to stimulate
further action and debate. We hope that
which explores and develops different aspects and individuals
of the four main hypotheses.
by demonstrating the potential benefits of will grapple with
using an analytical framework on voluntary 1. The problem and solution
sector effectiveness, more organisations and
these issues.
individuals will grapple with these issues. This The first section explores the importance of
could either involve applying our approach to a philanthropy in India, in terms of both its scale
broader set of topics, or proposing a modified and its distinctive role in addressing social
or different analytical approach. We believe that issues in India. It examines the evidence to see
India needs a broad-based effort to analyse whether philanthropy is working effectively. NPC
social problems and the role and success of the and Copal’s judgement is that it is not. Funding
voluntary sector’s response. does not appear to be prioritised optimally and
good information on the impact of individual
Process NGOs is rarely available. This is not unique to
India, but is consistent with NPC’s experience
Between March 2008 and May 2009, the in the UK and with reports from other national
NPC and Copal joint venture based a team voluntary sectors.
of analysts in Delhi. The analysts looked at
the voluntary sector as a whole, as well as Dealing with this problem is not straightforward,
researching two issues in depth: early childhood and there is no ‘magic bullet’. NPC and Copal
development, and water and sanitation. These propose that a comprehensive solution will need
topics were chosen based on an analysis to focus on at least three areas: encouraging
of different factors, including level of need, donors to demand information; supporting
donor interest, and the potential impact of the charities to capture their impact; and improving
research. the flow of information. Seen in this light, it is
possible to start creating an argument in favour
In order to explore different approaches, the of the report’s second hypothesis—that analysing
research process used varied slightly for each social issues and individual NGOs in India can
issue. It roughly shadowed the approach help improve the effectiveness of philanthropy.
pioneered by NPC in the UK, which follows five
main stages: NPC and Copal suggest that deeper analysis
will improve the flow of information and
1. Literature review and interviews with experts, encourage donors and NGOs to concentrate
such as government, academics and NGOs; more on evidence-based decision-making.
Specifically, it will provide a more rational set of
2. Development of a database of over 100
criteria for donors to choose which issues to
NGOs working in the sector, including core
fund, which organisations to support and how
information and data;
to improve the quality of funding.
3
Giving in India I Introduction
In the second section we look in greater detail The third and last section is designed to test
at what an analytical framework could look like, the final two hypotheses of this report: whether
setting out a structured methodology based it is actually possible in India to prioritise areas
on the approach that NPC has developed in its for philanthropy and identify effective charities
work on the UK voluntary sector. This focuses based on available evidence. While we have
analysis on four main factors: made a case for the theoretical need for
analysis in Section 1 and also sketched out
Pooling efforts • level of need; what a possible analytical framework would
• evidence of what works; look like in Section 2, it is only by demonstrating
and publicising how this framework works in practice that its
• activity by other actors; and
success and value can really be brought to life.
• the nature of the voluntary sector.
failure means NPC and Copal have chosen the water and
We explore these criteria within the context of sanitation sector as a test case, applying to
that costs can the Indian situation. We go into particular detail it each of the four stages of the analytical
be shared and when looking at the fourth area—the nature framework (the need; what works; activity by
of the Indian voluntary sector—as there are other actors; and the nature of the voluntary
the chances a number of features and challenges that are sector). With this, we hope to show how we
of success relevant to all donors interested in giving to
NGOs in India.
can use available information to identify critical
lessons and guidance that are evidence-based
increased. and focused on maximising the impact of
Donors interested primarily in sharing NPC and private giving.
Copal’s insights into the voluntary sector could
turn straight to this section (page 6). We have highlighted four priority areas for
philanthropy in relation to water and sanitation:
The overall framework is not proposed as a
definitive single approach to analysis, but rather • mobilising communities around hygiene
as one possible model. Any funder has to make promotion;
choices between different causes and different
• piloting technical and financial models for
organisations, but this sometimes happens on
improving water quality and sanitation;
the basis of implicit choices and judgements.
NPC and Copal’s approach is distinctive in that • strengthening the voluntary sector; and
it makes the basis of our decisions explicit and
• influencing government.
public. Accordingly, feedback is welcomed from
readers on this report. People may disagree with the exact priorities of
the research, and new evidence may change
NPC and Copal hope that developing this these findings, but NPC and Copal nevertheless
evidence base will encourage donors to believe that this section demonstrates the
become more effective. So, in addition to using underlying point—namely that it is possible
personal interests to determine their funding, to use the existing evidence base to channel
donors will have access to objective criteria and funding to areas where it is likely to have the
advice on how to prioritise where they give, and greatest impact.
how to choose individual charities to support.
This section can also be read alongside NPC
A further benefit in making our approach and and Copal’s sister report, Starting strong, which
learning transparent is that it stimulates and applies the same analytical framework to the
accelerates further debate about the role and early childhood development sector.
format of analysis in the voluntary sector. The
hope is that it will provoke other organisations
to propose different models or suggest Next steps
further refinements, in turn accelerating the
development of knowledge in this area. This document is intended as a modest step
towards better information and analysis of
Finally, we hope that it will help funders become
NGOs and social problems in India, and as a
more transparent and share their knowledge
diagnosis of a large-scale problem: a broken
more. Pooling efforts and publicising success
funding market.
and failure means that costs can be shared and
the chances of success increased. This has not
happened enough in the past. A commitment to
public knowledge is a central part of NPC and
Copal’s approach.
4
Giving in India I Introduction
Fixing the way NGOs are funded in India is not We hope that this document can be an
in the hands of any one organisation. What is inspiration to Indian philanthropists and NGOs
needed is a coalition of efforts. So this report to take up the baton. NPC and Copal will
should also be seen as a call to arms for continue to lend their knowledge and support to
individuals and organisations to support the help increase the effectiveness of Indian funders
cause of improving the effectiveness of the and NGOs.
voluntary sector.
Introduction
how this might work and what it could achieve,
but for it to really work we believe that this Conversions have been done on the basis of
initiative should be taken on by a coalition of £1 = Rs.79 = US$1.65.
India-based organisations.
5
The problem
and solution
455 million Despite its scale and its potential role in • Despite decades of effort to improve nutrition,
tackling Indian social problems, philanthropy 45% of under-threes in India are stunted (in
people in India in India does not appear to be working to effect, malnourished), a rate worse than that
full effect. found in sub-Saharan Africa.4
live on less than
• 455 million people in India live on less than
US$1.25 a day. The situation is partly obscured because of a
US$1.25 (£0.76) a day.5
lack of data. What evidence there is suggests
that money is neither being allocated to the Why is progress not quicker, and who should
most important areas of social need, nor be fixing these problems?
given to the most effective organisations.
Instead, funding is dysfunctional. A key cause is simply scale: the breadth, depth
and complexity of poverty in the country. Clearly
One way of conceptualising this is as a it is India itself, working through market forces
‘broken’ funding market, where money is and through its government, that has primary
not allocated on the basis of its potential responsibility for economic and social development.
social impact. The market’s characteristics Ask Indians, though, and many are sceptical about
include: donors who do not ask for the right the capacity of government or markets alone to
information; charities that do not supply useful deliver the type of change that is needed.
information; and poor flows of information
around the sector. In NPC’s experience, these Government is good at doing things at scale but
are also common features in the UK yet they it is often bad at innovation, weak at reaching
arguably have more serious consequences in excluded groups and scrutinising itself, and
India due to the high level of need. subject to short-term electorally-driven priorities.
Better information can help construct a Market solutions also offer scale, and they are
more effective philanthropy market. We responsive to consumer demands in a way that
suggest that research and analysis can government struggles to be, but market-based
help to allocate assets properly, direct approaches for the chronically poor at ‘the
funding to the most effective organisations, bottom of the pyramid’ are difficult to develop.
and improve the quality of that funding. Some needy people get priced out of goods
Undertaken collectively, this would and services, and markets themselves are
maximise the chances of philanthropy prone to failure.
having a significant impact on the lives of
disadvantaged people in India. To make progress on development, something
more than government and markets is needed.
Private giving— Private giving—philanthropy—has a vital role to
philanthropy— The problem play in tackling social problems. It is important,
not primarily because of its scale, but because
has a vital To some external observers, India is rapidly losing of the things it can do.
role to play in its tag of being a developing country, bolstered
Collectively, philanthropic spending is tiny
by high levels of economic growth and its record
tackling social as the world’s largest democracy. However,
compared with the power of government but
relative to other spending, philanthropy can
problems. scratch the surface and beneath the country’s
bear risk. It can kick-start innovation. It can
vast market and impressive entrepreneurial
fund unpopular causes. It can support voices
potential, it is clear that it still faces serious social
that hold government and business to account,
challenges. Most visibly it is scarred by poverty,
building the civil society structures that make
with hundreds of millions of people living without
democracy work. It is free from the pressure of
adequate healthcare, education or shelter. Look
the electoral cycle that can prevent long-term
at almost any area of human welfare and the
solutions to social problems. It is free from the
statistics remain startling. For instance:
pressure to generate a financial return that can
• India is more than 30 years behind China limit the reach of markets.
in terms of the proportion of the population
So how much private giving is there in India,
with completed secondary and post-
and how much difference is it making?
secondary schooling.3
6
Giving in India I The problem and solution
Domestic corporate In 2004, the domestic Indian fundraising market was measured at
and individual US$500m (£303m), excluding religious and untracked donations. 80%
donations of donations were from individuals.7
Domestic individual A 2008 phone survey of 1,012 people in urban India found that 41.2%
donations of respondents gave in the previous year, with an average contribution of
US$11 (£6.70) (excluding religious and family donations).8
Domestic corporate In 2000, it was found that domestic corporations gave Rs.2bn
donations (£25m).9
Foreign funding
Foreign remittances, Unknown. There are over 400,000 Indian-born remittance senders in the
from non-resident UK. A survey of 150 Indians in Washington State in the US found that
Indians (NRIs) direct the average Indian living in the US gives US$300 (£182) a year to social
to individuals in India causes in India. If this were true of even half of the 1.7 million Indians in
the US, social causes would be getting £157m from Indian migrants in
the US alone.10
Registered foreign In 2006/2007, overseas trusts and individuals gave Rs.123bn (£1.6bn).6
funding
Total foreign funding Combined foreign funding flows is unknown, but in 1997/1998 it was
to voluntary sector estimated at Rs.25.7bn (£326m).9
Cross-cutting segments
High net worth (HNW) Unknown. Conditions, until recently, were good. India led the world in
giving HNW population growth at 22.7% in 2008. Sunil Mittal, Anil Agarwal, Shiv
Nadar and Rohini Nilekani are Forbes’ 2009 ‘heroes of philanthropy’.11
Total funding to Indian NGOs
Total funding to Unknown. In 1999/2000, it was estimated at Rs.179bn (£2.3bn).12
Indian NGOs: foreign,
domestic and public,
and self-generated
* INGOs are increasingly establishing stand-alone country organisations (eg, Oxfam India). But these remain, in part, funders of other local NGOs.
7
Giving in India I The problem and solution
8
Giving in India I The problem and solution
The short answer is: not as much as it should. But this case is supported by anecdotal
evidence about the giving behaviour of It is unclear how
It is challenging to assess the effectiveness of individuals, suggesting that the flow of
giving because donors give their money away philanthropy is biased towards certain areas.
most donors are
in different ways and because there are not Many NRIs, who tend to come from Gujarat able to make
agreed benchmarks against which to measure and West Bengal, give back to villages or areas
it. Even in the UK, where there is a relatively well- where they were born. an objective
developed philanthropic sector, funders struggle
Also, funding tends to focus on certain types
decision on
to demonstrate the effectiveness of their work.
9
Giving in India I The problem and solution
having. Most report back on some information • are able to record project data and capture
to donors, but often this information is partial, their main outcomes using embedded
misleading or not meaningfully related to internal monitoring systems;
significant changes in the lives of the people
• commission external evaluations for specific
they work with. Box 1 describes the situation in
projects or at regular intervals; and
more detail.
• capture the long-term impact of their work.
Only a Only a handful of organisations—less than 3% of
Very few organisations met more than one or
our sample—measure their impact in ways we
handful of would consider as robust. This means that they: two of these criteria, with particular challenges
in relation to embedding internal monitoring
organisations— • have a clear ‘theory of change’, setting out and capturing long-term impact. Box 2 looks
less than 3% of a logical model of how their activities lead to in more detail at why NGOs do not measure
concrete outcomes; more consistently; while Box 3 sets out some
our sample— examples of what good measurement looks like.
measure their
impact in ways Box 1: NGO impact—what difference are organisations making, and how do they know it?
we would NPC and Copal looked at over 150 NGOs to find out what difference they were making, and how they
knew it. This was not a formal survey but part of an effort to identify high potential organisations in two
consider as sectors—early childhood development, and water and sanitation. Charities were identified on three
main criteria:
robust.
• their size—an income of over Rs.500,000 (£6,300);
• their presence in directories available from organisations like GiveIndia and Indianngos.com
(see p. 13); and
All three of these factors make it likely that the NGOs seen are better-established and adhere to higher
standards than the average charity in India.
Our main finding was that only a minority of organisations have information easily available that
clearly describes their activities, let alone the difference they are making. Where information was
available or (in its presence or absence) where NPC and Copal analysts were able to speak to
management, information quality was mixed. Charities primarily describe what they are achieving
by talking about what they do and/or providing case studies and anecdotes about people they
have worked with.
Focus on outputs—When charities describe what they do, they talk about outputs (the quantification
of their activities), not outcomes (what those activities achieve). A strong example of this is NGOs
running primary schools, many of which track enrolment and, in some cases, attendance. Relatively
few track the difference that school makes to pupil attainment. This matters. NPC and Copal saw
a number of educational establishments where each could boast high enrolment rates, but where
learning was clearly inadequate (teaching by rote; disengaged students; absent teachers). Survey
evidence establishes this as a problem for India as a whole. Outputs are useful to know, but only rarely
is knowing what a charity does enough, and this information can in fact be misleading.
Focus on case studies and anecdotes—Case studies and anecdotes are useful to give a sense of
an organisation, but they may be unrepresentative. Charities rarely draw attention to their failures.
Anecdotes risk generalising, misleadingly, from success. They also present a more subtle problem.
Out of 100 people in a programme, the odds are that some of them will see their lives improve, just
by chance, regardless of what programmes they are or are not enrolled in.
Lack of long-term data—Even when charities collect outcomes data, this is usually extremely
short term, measuring impact immediately after the end of an intervention and with very
little follow-up to judge the sustained impact of their work. For example, measuring exam
attainment, but not what this means for future employment, livelihood and health. Of course, new
interventions will be unable to do this, yet for more established projects, measuring long-term
impact is vital in judging the full scope of their work.
Some organisations measure progress against particular indicators of interest to donors, but they
tend to see this as a compliance exercise rather than an integral part of the way that they help
their beneficiaries.
10
Giving in India I The problem and solution
During our research, NPC and Copal came up against six main reasons why NGOs do not
measure their results more.
1. Because they do not think they need to—A lot of grassroots organisations are values-driven
and rely on proxies for understanding their impact. For instance, the belief that staff have
high quality personal relationships with beneficiaries. They rely too on intuition, assuming
that scholarships for girls or a place in an orphanage or a rainwater harvesting system are In the absence
good in and of themselves. This may be right, but without measurement it is impossible to be of adequate
sure. Moreover, it is easy to overlook weaknesses in an approach if you just rely on whether
something sounds or looks like it should work. For example, scholarships may only be going data, the main
to better-off groups; an orphanage may not be improving children’s life chances; and the
drivers of funding
4. Because they lack the skills—This is discussed below in more depth. Grassroots NGOs suffer from
shortages of key skills and infrastructure (such as IT). These are substantial barriers and even if NGOs
look for external evaluators, they struggle to find individuals or institutions of the necessary quality.
5. Because it seems expensive—Donors and charities are often reluctant to divert resources
away from core activity but, without measurement, it is likely that resources will not be
used properly.
It is important to note that this is by no means a funder’s radar; and the influence of marketing and
problem confined to India. NPC’s work in the UK promotional material. This is particularly relevant for
has come across exactly the same situation, as individual donors who, in examples NPC and Copal
have other intermediaries in different parts of the have encountered, rarely think about impact at all.
world. Moreover, a lack of results measurement
would not really matter if each NGO was doing The picture on corporates, INGOs and trusts
equally valuable work in an equally effective and foundations is more mixed. Some ask for
manner. However, this is logically unlikely to evidence of effectiveness and base decisions
be the case and, based on NPC and Copal’s on it. INGOs, for instance, increasingly have
visits to programmes on the ground, NGO structured ‘partner assessment tools’ that touch
performance varies widely. Without objective on impact within a wider framework of analysis
measurement criteria to understand these considering an organisation’s capacity.
variations, it is highly unlikely that funders will
There is an irony here. All kinds of donors in
choose the most effective NGOs to fund.
India are very conscious of some sort of risk to
NPC and Copal’s concerns are underlined by the their funding: corruption and waste. To address
way that funders choose NGOs in practice. Our such concerns, there has been a marked
experience is that in the absence of adequate response from within the NGO community
data, the main drivers of funding to particular to improve transparency, accountability and
organisations are largely a mixture of subjective standards of governance (see Box 4). Yet there
factors. These include: personal relationships is much less awareness of a different risk: that
between funders and organisations; the fact that funding may be going to organisations that are
an organisation happens to have come across a not making good use of it.
11
Giving in India I The problem and solution
A need for a focus on measurement is one reason why donors interested in supporting grassroots
organisations are often well advised to work through intermediaries. Though their performance
is mixed, some INGOs do excellent work in monitoring and evaluation. CARE India and USAID
recently released a working paper series on Women and Child Health, highlighting the results and
One of the lessons of five years of a massive programme, known as RACHNA.21 Measurement of its results
helped both to establish the value of the programme, and to highlight areas for improvement. For
biggest instance, early on in the programme, it seemed that replication of demonstration centres being
challenges run by CARE India’s partners was going well. But introduction of a household survey of the target
areas found low levels of coverage and little change in key behaviours the programme was trying
facing Indian to bring about. Ultimately the programme was corrected, and later evaluation proved it to be
NGOs is not a extremely promising. Overall, it is thought RACHNA averted 13,356 deaths and was responsible
for a gain of 380,719 DALYs (Disability Adjusted Life Years) over its lifetime at a cost of US$1,098
lack of capital, (£665) per death averted and US$39 (£24) per DALY gained.
but funders Recently, some NGOs have been involved in the gold standard of measurement—randomised
who give control trials (RCTs) conducted through partnership with MIT’s Poverty Action Lab (J-PAL). RCTs
create two groups that are identical in all respects except one is exposed to a particular intervention.
money without Any difference in the group outcomes can therefore be attributed to the intervention. RCTs are useful
asking for to correct or change beliefs as they provide clear evidence of what works. However, they need to be
based on a clear theory as to the basis of interventions and why they work.
measurement of
J-PAL has worked with a variety of large Indian NGOs including Pratham, an education NGO,
impact on the and Seva Mandir in Rajasthan, which focuses on integrated rural development. A recent study
final recipient. evaluating an experimental programme to promote uptake of vaccinations has established robustly
the effectiveness of using incentives for immunisation. People spend very little on preventative
Barun Mohanty care—often because of small practical obstacles or just not getting around to it. J-PAL’s study with
Seva Mandir has found that they increased take-up rates by a factor of ten, by buying a kilo of lentils
to reward mothers who ensure that their children complete vaccination programmes.
This kind of work is expensive, but by doing it, NGOs can validate existing or new approaches,
contribute to the evidence base on how to tackle serious social problems, and attract new funding.
NPC and Copal talked to a range of different NPC and Copal’s thesis: the funding
grant-makers during our research. The views market is broken
of some of the most strategic and professional
among them are captured in a comment made Although patchy, the evidence outlined above
by Barun Mohanty of the Michael and Susan supports the first of NPC and Copal’s main
Dell Foundation: ‘One of the biggest challenges hypotheses: that the philanthropy market in
facing Indian NGOs is not a lack of capital, but India is not working effectively. While in an
funders who give money without asking for ideal scenario, philanthropy should be flexible,
measurement of impact on the final recipient.’22 versatile, risk-bearing and a promoter of
innovation, in practice it is not being spent
NPC and Copal believe that when funding is
in ways likely to maximise its social impact.
not linked to results evidence, this matters.
Rather, NPC and Copal were told that it is often
Most obviously, it matters because where
spent conservatively and thoughtlessly—without
people are giving capital away without an
consideration of the urgency of particular
objective basis it is likely to go to the wrong
needs, or the likelihood that the organisation
organisations. There is an opportunity cost for
funded will really make a difference.
the funding itself. It could have improved more
lives being spent somewhere else. But ‘lazy NPC has found it helpful in the UK to
funding’ is also a problem at a structural level. conceptualise this problem as a ‘broken’ funding
Where funders and NGOs are not focused on market. By the term ‘market’ we mean simply that
effectiveness and measuring their impact, there there is an implicit economic system governing
is little ‘market’ reward or discipline affecting philanthropy. There is both demand for funding
NGOs: organisations that do measure may from NGOs and a supply of funding from a wide
be disadvantaged relative to ones that do not range of donors. The market is broken because it
(for example, because they bear higher costs). is unlikely that money is flowing to where returns
Good projects cannot grow; bad projects are are highest. Funds are being spent, but without
not challenged. knowledge of where they can be allocated for
best effect. Indicators of success—which in this
12
Giving in India I The problem and solution
NPC and Copal’s joint venture in India was partly prompted by NPC’s March 2008 research report, Philanthropists without borders,
which surveyed 122 philanthropists and carried out in-depth interviews with 19 based in the UK.2 It found that the main barriers to
giving in developing countries were lack of trust, lack of transparency and concern about corruption.
These are not trivial concerns. Waste and corruption are real risks in a country where some NGOs are not real charities but vehicles
for political ambition. Even where outright fraud is not practiced, there are more subtle shapes it can take. NPC and Copal have
heard of hospitals being built with donors’ funds where part of the expenditure has been dedicated to constructing permanent on-
site housing for the chief executive and other key staff.
The good news is that a number of in-country initiatives in India are being established to promote good governance, transparency
and honesty. Encouragingly, these are from the sector itself.
GiveIndia—www.giveindia.org—is an online giving portal and philanthropy exchange that allows donors to give online to NGOs
that have been validated against CA minimum and desirable norms, with an additional requirement that they commit to report back
annually on any donation they receive. It has more than 200 NGOs online, covering 14 states and 27 causes. Validation here includes
a visit and in some cases references from partners.
CAF India—www.cafindia.org—provides services to donors and charities and includes on its website a directory of organisations on
which it states it has carried out ‘due diligence’.
In addition to these bodies serving a quasi-regulatory function, there are a number of databases being established, simply to list
different NGOs and improve access to data about the sector as a whole. Guidestar India, a large online database of NGOs (based on
self-reporting), is currently being established, with the initial aim of covering at least 1,000 organisations. Indianngos.com comprises
a database of 36,000 NGOs, but with much more uneven quality of information available. Another player is Propoor.org, which says
it lists over 14,000 NGOs from across South Asia.
All of these initiatives are positive steps towards improving the flow of information about NGOs in India, and they are helping
to channel resources. Funds channelled directly to NGOs by GiveIndia comprised Rs.267m (£3.4m) in 2008/2009. CAF India
distributed Rs.23m (£291,000) in 2007/2008.
What none of them do is put much visible emphasis on impact or results. CAF goes furthest in this direction, quoting some evidence
on impact for organisations it has worked with. GiveIndia highlights impact as a concern but does not have the resources to do its
own research. For the other organisations, impact is a level above their area of focus, which is establishing basic information.
NPC and Copal’s view is that donors should not focus alone on the risk of corruption. It is one of a range of risks to the effective
use of philanthropic capital, but one that already attracts a good deal of NGO energy and attention. It would be ironic if the need for
assurance about the tangible problem of money being ‘safe’ blinded philanthropists to the wider possibility that money is not being
used effectively. Equally, it is not enough for NGOs to improve transparency without improving effectiveness.
case are the social impact a charity is having—are This problem is clearly not unique to India.
not available or are not being used to determine NPC was established as a charity in 2002
funding allocation. precisely because its founders noticed that
charitable funding was being decided on the
As NPC and Copal conceive it, the problem basis of brand and personal connection, with
is circular. Funders are either not asking for little consideration of impact. Subsequent
information about impact or are asking for the research has confirmed this impression: many
wrong information. NGOs in turn are unable to UK charities do not produce strong evidence of
provide comprehensive information on what their results.
they are achieving. Even when monitoring is
carried out, little is made public, particularly That said, having a broken funding market in
when it is negative. Organisations can repeat India arguably matters more than in the UK, due
their mistakes, not learning from the past or to the much higher level of need. Charities in
from each other, and all of that is likely to mean the UK are often about well-being and quality
waste on a large scale—of money and of lives. of life. In India, they are fundamental to the
13
Giving in India I The problem and solution
social safety net that allows people to survive. Altogether, constructing this market is a large
The issue has been brought into stark relief by undertaking, and NPC and Copal’s work in India
the economic downturn, which puts a renewed has concentrated on testing the potential of one
premium on generating the biggest possible facet of this solution—analysing particular social
‘social returns’. issues and NGOs. We explore these below.
Demand for
Information: Funders
need to ask about
results; intuition is not
good enough
We need a
philanthropic
Supply of funding market Flow of Information:
Information: NGOs Independent
need to measure their
information on what,
outcomes in ways that
where, and to whom to
can be subject to
give needs to be
external validation
publicly available
14
Giving in India I The problem and solution
to fund; and two, to show that the quality of As mentioned above, donors often ask for
information is important. After all, some donors the wrong thing or make requests that are
already receive information, but it is often either disproportionately bureaucratic or time-
incomplete or relating to the wrong metrics of consuming to comply with. Some NGOs feel
success. For example, donors in both the UK an acute power inequality. They say that they
and India often focus on administration costs or cannot think about measuring what matters
fundraising ratios (money spent on fundraising because they are busy reporting on what does
vs total raised). Yet as we will go on to explain not. Grassroots NGOs in India, a long way By sharing
below, these are often unhelpful proxies of both literally and figuratively from some of their insights,
impact, and are only useful within a much wider funders, find this a particular challenge.
set of data. donors not
NPC carried out research in Scotland on
Instead, more useful information would include: the reporting burden for NGOs, highlighting only improve
numerous incidences of unnecessary and their own
15
Giving in India I The problem and solution
• Building strategy and expertise: drawing on the research of NPC and Beyond increasing the flow of information
others to develop funders’ knowledge of social issues, identify gaps and between donors and NGOs, there is also
opportunities, and develop funding strategies. a need to use wider sets of data to inform
decision-making. This includes clearer
• Improving grant-making processes: helping funders to improve how they
information on the specific role of the voluntary
find, select, fund and monitor the charities they support.
sector and philanthropy in general. Funders and
• Reviewing giving: working with funders to conduct a strategic review NGOs are not isolated actors—they operate
(looking at their focus, approach and impact) to inform future funding. within a wider context of social needs and
government policy, and are part of broader
• Bespoke consulting: carrying out a tailored piece of consulting to meet a
voluntary and philanthropy sectors. Without
foundation’s particular needs.
understanding this broader environment,
Services for charities philanthropists are in danger of misinterpreting
data on charities’ impact.
• Charity health checks: providing chief executives or trustees with an
overview of the charity and its strengths and weaknesses to inform future
development. What NPC and Copal have been
doing: analysis and research
• Bespoke sector research and consulting: providing bespoke research and
advice on key strategic questions. Where does NPC and Copal’s activity fit in to
• Measuring impact: helping charities to develop and implement clear all this?
frameworks to evaluate their impact, inform strategy and better
As noted above, fixing a broken funding market
communicate to funders the impact of their work. Also helping charities
is a vast agenda and not one that is in the
with cost benefit analysis to determine the economic value of their work.
hands of any one organisation to deliver. In the
Improving flow of information UK, NPC has developed a range of different
• Building and sharing public knowledge: building sector knowledge by initiatives across each of these three areas,
analysing particular social issues and identifying priorities for funding and such as developing measurement tools and
ways to increase the efficacy of funding. providing strategic advice to donors and NGOs
(see Box 5). It has also started developing its
• Knowledge sharing: helping to establish the Association of Nonprofit international offering (see Box 6). For the pilot in
Analysts, a global organisation to help build links and share information. India, the joint venture between Copal and NPC
decided to concentrate on one vital part of
the puzzle.
Flow of information
The approach that NPC and Copal has sought
Finally, there is the flow of information. to test is sector and organisational analysis
Increasing supply and demand should lead to in India. This has traditionally been the main
improvements in the flow of information in any focus of NPC’s work in the UK. It involves
Analysis and case. But to have full impact, it ideally needs to analysing information on social issues and on
individual NGOs, using a public methodological
research can be publicly available so that other donors and
framework, which is set out in NPC’s report
NGOs can use it; so that lessons are learned;
often look like and so that mistakes are not repeated. This is Funding success.2
why everything that NPC and Copal produces
transaction is freely available. We also seek to encourage We think sector and organisational research has
costs, but disclosure and build an environment where potential to help overcome some of the funding
market flaws. Primarily, it will help augment
organisations and funders will share bad news
in fact, they as well as good. the third aspect of fixing the funding market
outlined above—the flow of information—
are crucial to bringing together key data and presenting it
Ultimately, the goal is the development of
achieving social ‘public utility’ information sources on NGOs and in an accessible and useful way for a donor.
social problems where donors and NGOs can Beyond this, it also aims to stimulate donor
change. identify who is doing what, how well and with demand for data and the supply of information
what certainty of success. by demonstrating the utility and applicability of
evidence-based analysis.
16
Giving in India I The problem and solution
* DALY is a standard World Health Organization metric that combines mortality and morbidity costs.
17
Giving in India I The problem and solution
sectors: early childhood development and Our framework looks at five factors to meet this
water and sanitation. This segmentation allows challenge, which collectively give a deep insight
understanding of context and makes it easier to into NGO effectiveness:
draw comparisons between organisations.
• focus on need—that it targets excluded
Analysts make initial contact with a large groups or neglected issues;
sample of organisations recommended by
• results—that it measures results in a
experts, and screen them by an analysis of
sensible way; that it uses its results to
Efficiency their documentation and through phone calls.
improve its services; that its results compare
They then visit 20–25 NGOs and carry out a
certainly matters series of interviews with management, trustees,
favourably to peer organisations;
but the key finance directors and beneficiaries. There is then • management quality—that it is led well,
extensive follow-up to dig deep in a number of has a strategic focus, and has strong senior
challenge for key areas. management;
Indian NGOs The aim is twofold. On the one hand, it is to • ambition—that it is committed to increasing
identified by identify and analyse NGOs that are making the number of lives it touches or having a
a real impact in order to increase information more profound impact upon them; and
NPC and flow to donors. On the other hand, it is to help • use of resources—that it is efficient and
Copal’s analysis NGOs improve directly. Being analysed is in stable.
itself a consulting-type service that can highlight
was not waste, areas for improvement. The ‘how’: Analysis and research improves
the quality of funding
it was talent— A distinctive feature of NPC and Copal’s
particularly for approach is that it seeks to look at whole A third and final area where analysis makes a
organisations. Our primary interest is in difference is on how to fund. Donors and NGOs
professional effectiveness and high social impact but helping often have a lot of preconceptions about each
other and can form relationships under terms
roles. donors or NGOs deliver high ‘social returns’
that harm both their interests. Analysis of social
needs more than just evidence of impact.
Executing an approach that is highly effective problems and NGO sectors helps bring these
also requires other capacities, including stable problems to light.
management and finances, good governance
One example commonly mentioned in India is
and the ability to sustain a programme.
funding for central organisation costs, such as
management and central overheads. Project-
based funders are often unwilling to meet this
part of the expense of NGOs with distorting
effects—NGOs end up having to chase projects
that are outside their mission and competence
in order to pay their central costs.
18
Developing a framework
The previous section made the case that Factors in giving
better information would help to improve
the effectiveness of the philanthropy When thinking about giving, NPC and Copal
market and highlighted the importance traditionally identify three key variables affecting
of analysing social issues and individual a donor. These variables overlap, influence each
organisations. Yet this still leaves several other, and produce a final funding decision:
questions—in particular, what exactly an
analytical framework should look like. It • the donor’s interests;
also leaves open how it might relate to
• the available resources that the donor can
other factors that affect donors and their
From NPC and Copal’s perspective, The first two issues (interests and resources) are
philanthropy is sometimes overly primarily internal factors—that is, answerable
influenced by a donor’s subjective in the main by reflection on a donor’s values,
concerns. Important issues, such as beliefs, aims and assets. The third (where funds
where available resources can be used can have an impact) is primarily external—that
for greatest impact, are neglected or is, answerable by reference to information about
inadequately thought through. This is the world. This third issue is the focus of NPC
not to say that personal interests are and Copal’s analytical approach. NPC and
unimportant—they are central both to Copal believe that the focus of giving should be
motivating a philanthropist and to setting where these three factors overlap (see Figure 2).
a general strategic direction for giving.
Figure 2: Factors in giving
They should, however, be informed and
influenced by actual evidence of impact.
19
Giving in India I Developing a framework
Yet, it is largely individual interest and passion education or women, to more specific and often
that underpin a donor’s involvement in intersecting interests, such as the healthcare
philanthropy and that provide the impetus and of slum children in Chennai. Because different
motivation for continued giving. Neglecting or issues are heavily interlinked, some donors
overlooking these factors can make philanthropy prefer to focus on groups and take a holistic
less involving, less engaging and less satisfying. approach in meeting their different needs. Others
Over the long term, this may cause people to like the clarity of one issue, such as healthcare
withdraw or scale back their giving. or education.
NPC and
Also, looking at it from a macro-perspective, Nature of impact: Often a donor may be
Copal would there are many competing good causes. As interested in having impact at a particular
distinguish noted above, analysis cannot on its own fill level of scale. He or she may want to change
in a blank piece of paper. Internal drivers are the entire policy environment, or conversely
between those important in helping donors choose between want to focus on improving the lives of a
funders who let competing choices of effective funding. Yet small number of people. There tends to be a
NPC and Copal would distinguish between trade-off between the breadth and depth of
their personal those funders who let their personal interests an intervention, and the certainty of outcome.
interests override evidence of effectiveness, and those NPC’s triangle (see Figure 3) makes this clear.
who use evidence to shape and inform their A fixed sum of money can do a lot for a small
override interests. Data can tell us something about the number of people, or less for a large number.
relative merits of different options. Funders can pay for services to be delivered
evidence of with high certainty of impact but limited
effectiveness, It is useful to look briefly at what some of these numbers, or pay for campaigning and lobbying,
internal factors are. Many donors are not used where certainty of impact is lower but the
and those who to articulating them in any structured way. potential exists to change whole systems.
use evidence Interests For example, a donor interested in livelihood work
to shape and could have sponsored a job creation programme
Donors’ interests can derive from multiple
in a village. Or he or she could have contributed
inform their sources—for instance, a personal connection
to the campaign that eventually led to the
to a cause, an issue or place, or religious or
interests. ethical inspiration. There are often also group
National Rural Employment Guarantee Act, a vast
national employment welfare programme.
or corporate motivations in play; for a family,
bringing them together around philanthropy; for Nature of project: Finally, donors may have
a business, finding a cause that is aligned with specific views on the nature and type of the
the organisation’s goals and brand. project they will fund. Some are prepared to pay
for risky projects that might lead to innovations,
These interests can be understood on three
while others want a safer, proven and trusted
main levels:
approach. A key issue at the moment with
many international donors is the wish to fund
Nature of need: A donor may have strong views
scalable and replicable projects. An important
on focusing on a particular issue, geography or
related consideration is exit strategy. Some
group. This can be at a general level, such as
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20
Giving in India I Developing a framework
projects are time-limited. Others will need decisions are too often determined by personal
ongoing funding, so provision needs to be issues rather than evidence on where funding
made for long-term sustainability. would have most impact. By expanding the
evidence base, NPC and Copal aim to redress
Available resources this imbalance and increase the role of data in
making funding decisions.
The second important factor is donor
resources. Each donor will have a particular In a world of scarce resources and limitless social
set of assets that he or she can bring to bear need, NPC and Copal consider that money In a world
on social problems. Most attention is given to should be spent on the most urgent causes
finance, but often donors can use a range of that it is possible to address with a reasonable
of scarce
other resources as well. probability of success. To identify these, donors resources and
need information about four factors:
Financial: Donors will have a certain amount of limitless social
money that they want to give. They may also have
a clear sense of their level of financial commitment
• levels of need;
need, NPC
• what works;
through time—whether one year or multi-year. and Copal
Increasingly, donors are thinking of different ways • activity by other actors; and
that they can structure financial resources to consider that
• the nature of the voluntary sector.
money should
21
Giving in India I Developing a framework
• Social impact investment: this is where investors place capital with businesses or funds,
in order to achieve specific social aims. This capital may be in a range of forms including
equity, debt, working capital, lines of credit, and loan guarantees. Examples in India include
microfinance, construction of cheap housing, private hospitals and schools and clean energy.
• Funding social enterprises: this is the third main area for social investors. Social enterprises
are organisations that are run along business lines, but where any profits are reinvested into
the community or into service developments.
Social investment, in all of its forms, has been gaining increased traction in India. It is seen as a
way to harness the power of global capital for social good, and to tap the potential innovation,
efficiency and scale of the private sector. It also makes the money ‘work harder’ as any financial
return can then be recycled and reinvested in other forms of social investment. It is also often
argued that having some form of financial expectation is a good discipline on social organisations
themselves because it helps to focus attention on the sustainability of the business model.
Despite these potential opportunities and its ability to complement philanthropic activity, social
investment in India also faces broad challenges. The first is the difficulty of measuring social impact, a
constraint that makes the trade-off between financial and social benefits hard to assess. The second
is a relative dearth of organisations with the capacity to absorb large amounts of capital—a lot of
the same names get mentioned by different social investors. The third is that the market place is
underdeveloped, without a fully developed infrastructure of networks, advisors and intermediaries.
Significant work has happened in the past decade to address these issues. Dedicated social
investment funds have grown up to build knowledge and expertise in the area. One of the most
well-known social investment funds is the Acumen Fund, which was set up in 2001 with
seed capital from the Rockefeller Foundation, Cisco Systems Foundation and three individual
philanthropists. It funds in South and East Africa, Pakistan and India, and concentrates on critical
services: water, health, housing, and energy. It is currently funding 12 initiatives in India, which
include a network of maternity and child healthcare hospitals to cater for slum populations, and
a firm that tests people for short-sightedness and sells glasses. As with most social investment
funds, it has three main criteria in its investments: potential for significant social impact; financial
sustainability; and potential to achieve scale.
In 2008, the Soros Economic Development Fund, along with Google.org and the Omidyar Network,
set up a targeted $17m investment fund for small or medium-sized industries (SMEs) in India—a
section of the economy that falls between microloans and larger commercial investments. This is
being run out of the Centre for Emerging Market Solutions at the Indian School of Business at
Hyderabad and, so far, it has invested in areas such as waste management and eye hospitals.
As well as specific investment vehicles, there are also organisations that help improve the
knowledge and research available on social investment, to provide capacity support and help
attract capital to successful schemes. In 2006, the Monitor Institute, a think tank/consultancy
that focuses on social issues, set up a new Indian initiative called Monitor Inclusive Markets (MIM).
This researches the role of for-profit business models in solving Indian social problems and helps
them overcome barriers to scale. It is currently piloting efforts to develop affordable housing for
slum dwellers in India. The World Resources Institute, a US-based think tank, has developed
its own New Ventures scheme, in partnership with the US government, to direct capital to
businesses in emerging markets (including India) that deliver social and environmental benefits.
A further level of support exists for individual social entrepreneurs. Organisations, such as Ashoka,
Unltd India, the Skoll Foundation and Social Impact, provide support to people who have
innovative approaches to tackling social issues. As well as usually providing cash awards, they
also offer capacity support, coaching and links into wider networks. The Skoll Foundation holds an
annual World Forum, bringing together social entrepreneurs, policy-makers and financiers.
22
Giving in India I Developing a framework
Category Value
Logical model A basic model of how an activity might work logically, even if unproven, is a good
starting point for an NGO.
Similar experience If an NGO has had similar experience elsewhere, then replication may be a good
elsewhere idea, but this needs careful testing.
Research If research elsewhere indicates that a course of action is good, then applying it in a
new context may be a good idea but should be tested as soon as resources allow.
User feedback Feedback is valuable to ascertain (perceived) quality of services. However, a user
saying ‘I enjoyed the meeting’ does not prove that the meeting achieved any
improvement in circumstances. Well-constructed user feedback can nevertheless
form part of systematic measurement.
Demand Demand gives a clue as to how users value a service. However, high demand for
a service may denote desperation for any help, rather than an endorsement of this
particular help.
Evaluations Evaluations are detailed pieces of research determining whether a specific
activity works, whether it could be improved or expanded, and what should be
measured going forward. It is wise to do a detailed evaluation more than once: later
evaluations can show the detail of whether an activity has abated or is still relevant.
Systematic Some NGOs find a way of systematically determining the improved outcomes for
measurement their beneficiaries. This could be reported by users, observed by family members,
or collected by professionals, for example, using clinical scales. Ideally this is
collated in some way.
23
Giving in India I Developing a framework
Different levels of evidence are expected at are high. Often it takes years for campaigning
different stages of organisational development. activities to pay off and, again, attributing
For example, a young charity is unlikely to have success to any one organisation can be difficult.
evidence of its results until it has been running
for a period of time. In the UK, NPC has produced the report Critical
masses, which stresses the importance of
In development, health interventions tend social campaigning. It suggests that a more
to have the strongest level of evidence. Eye constructive way to think about the question is to
surgery, anti-worming tablets and immunisations look closely at an NGO’s contribution, rather than
produce direct and tangible returns, in terms of ruthlessly searching for proof of its precise effect.
quality of life, education and livelihood. Social
and educational approaches face greater Activity by government, private sector
challenges in establishing what works, especially and other donors
where they are aiming for behaviour change.
The third factor for donors to look at is how
A major issue for a donor to be aware of is philanthropy fits within the public and private
transferability. Just because an approach is sectors—particularly given the size and impact
effective in one context, it does not mean it will of existing funding flows from other players.
work in another context. Different communities, As noted, a philanthropist should be sure not
different delivery mechanisms and different cultural to substitute for government responsibilities,
factors will influence impact. Projects that lead to and may have more of an impact by focusing
a set of outcomes in one state may not work in on areas overlooked by existing funders. A
another. Plan International developed a project clearer understanding of the context highlights
to promote better hygiene behaviour in southern possibilities for complementing and leveraging
India through pamphlets demonstrating hand- existing work, and can suggest ways of
washing techniques—yet when it transferred this achieving scale and exit (for example, where
to the north west, it was initially unsuccessful. This central or state government takes on an
was due to the fact that in the north west, people approach that has been piloted by an NGO
traditionally used ash to clean their hands. The using philanthropic support).
material had to be tailored accordingly.
A key issue for donors to understand is that
Donors also have to think about the structural implementation of government policy in India
impact of interventions. It can be extremely is patchy, opaque and inconsistent. Despite
tempting for a donor to fund parallel delivery efforts towards decentralisation, central and state
systems where government is not working governments still set the agenda and as policies
effectively. Yet this can compound the problems, travel down to the grassroots, funds get diverted.
enabling government to underinvest in an area
Corruption, lack of accountability and
and using up qualified staff. All this has a wider
low capacity are problems at all levels of
impact. Donors also need to think about the
government. These tend to be particularly
economic effects. For example, there is a long-
chronic in areas of higher need, where poor
running debate over non-emergency food aid,
governance is both a product and a cause
questioning whether its short-term benefits come
of underdevelopment. Lant Pritchett of the
at the expense of damaging farming capacity.26
Kennedy School of Government at Harvard
Over the last decade in India, the focus on argues that dysfunction in India’s public sector
development has moved from providing is one of the world’s top ten biggest problems—
services to a more ‘rights-based’ approach—in of the order of HIV/AIDS and climate change.27
simple terms, building up the skills of individuals
Similarly, donors need to consider their
and communities to claim their legal rights,
relationship with the private sector. This is most
and developing the capacity of government to
obvious in relation to businesses as funders
fulfil its obligations. Measuring the impact of
where they are a much larger player in Indian
these empowerment activities poses greater
philanthropy than, say, in the UK. But it is also
challenges than simple service delivery projects
a question of relating to the private sector
due to difficulties over attribution and capturing
as a deliverer of services, with India home to
less tangible outcomes, such as self-esteem
an explosion of private schools and private
and gender equality. Results may also take
hospitals over the past decade. Many Indian
more time to emerge.
NGOs are cautious about the private sector
The problem of capturing evidence is even being used to deliver social ends, fearing
more acute for NGOs that operate at a higher that poor people will be priced out, exploited
level of activity, lobbying government and or given poor service. A few donors have
advocating for policy change. Although the increasingly been looking to businesses to
potential impact of this work is significant— deliver approaches at scale—for example, the
influencing government funding, establishing Omidyar Network, the philanthropic investment
legal frameworks, providing a voice for the firm established by eBay founder Pierre
excluded—the challenges in measurement Omidyar and his wife.
24
Giving in India I Developing a framework
25
Giving in India I Developing a framework
The other major constraint on non-Indian impetus to develop. When this ends, either due
donors is that only 34,000 NGOs are eligible to changing funding practices or an economic
to receive foreign donations.6 As noted in the downturn, NGOs are left scrabbling for a
previous chapter, organisations looking for replacement. Exit funding (ie, what an NGO is
foreign funding are required to register under going to do when the donation runs out) should
the Indian government’s FCRA legislation. This be a key issue for philanthropists.
regulates who can receive foreign donations,
and was designed partly as an anti-terrorism In order to cope with financial instability and the
In total, it is measure. However, some NGOs complain termination of particular funding streams, many
NGOs are trying to build up their corpus funds.
estimated that that the government has used the FCRA to
These are similar to reserves yet, except in rare
withdraw recognition from campaigning and
foreign funding policy NGOs that disagree with its policies. circumstances, NGOs are unable to touch the
capital. Rather, they use its income as a source
provides only In total, it is estimated that foreign funding of unrestricted funding.
7.4% of funding provides only 7.4% of funding to the sector.12
Activities
This masks huge diversity in reliance on
to the sector. international philanthropy. The Child in Need Financial instability has dramatic implications
Institute receives almost half its funding for what NGOs in India do and how they do
The Society of from abroad, while Sulabh International, a it. It is one of the factors driving a sector that
Participatory Research sanitation charity with an income of Rs.1bn is largely characterised by generalist NGOs—
in Asia (PRIA)12 (£13m) receives no foreign funding. ones that will turn their hands to a number
of different activities. To the extent that this
Within the sector there is a growing appetite
reflects organisations chasing whatever funding
to draw on local funding opportunities, both
happens to be available in order to stay afloat, it
from indigenous trusts and corporates and
is an unhealthy trend. However, in many cases it
from individual philanthropists. However, efforts
is also a question of mission.
are often limited by low fundraising capacity.
Normally, responsibility rests on overworked The ‘typical’ organisation seen by NPC
chief executives. Very few organisations have and Copal during our research worked on
dedicated fundraisers. ‘integrated rural development’. Often these
organisations began with a focus on one issue
Low fundraising capacity also reflects a more
in one geography—health or education—before
general weakness in financial management.
rapidly realising that the barriers to improving
While some NGOs benefit from highly-qualified
people’s lives go beyond that intervention alone.
financial teams, others are lacking—the Aga
Other project strands get added, including work
Khan Rural Support Programme India has
to improve livelihoods, gender empowerment
started an initiative to let other NGOs draw on
and microfinance.
the expertise of its financial staff. There may
be a general lesson here for donors: on the The challenges to these sorts of organisation
one hand to be patient with organisations that are threefold.
may not have good financial reporting skills; on
the other, to provide capacity-building support The first is about how truly integrated their
rather than grants alone. services are. Good examples think carefully
about the links between their different activities
NGO financial management is particularly and how to overcome all the barriers to (for
important at the moment due to increasing instance) helping children read or empowering
uncertainty in funding. The economic downturn women. A more frequent situation is that the
has affected the endowments of foundations, projects are not genuinely integrated, but run in
while there are some reports that INGOs that separate places.
rely on direct debits or popular subscriptions
have seen donations dry up. The second challenge is about quality. NGOs
that are ‘jacks of all trades’ are sometimes
Funding practices from grant-makers are not ‘masters of none’. Donors need to look closely
always helpful to the sector. Grants are often at how well organisations are able to operate
renewed on a yearly basis, making it hard where they are engaged in many activities.
for NGOs to plan in advance. Charities often
struggle to cover their core costs from project- The third challenge is how NGOs pay for
based grants. There are some exceptions ‘holistic’ approaches. NPC and Copal saw
to this—INGOs and agencies can fund fairly any number of organisations that had built in a
generously—but here a different problem livelihood and income-generating activity into
sometimes emerges, with payment in arrears their wider project, believing that in the long
causing NGOs cash flow problems. term this would provide a way for communities
to pay for their services, hence making them
Also, long-term funding relationships (often over sustainable. In general, these plans were
decades) have left some NGOs dangerously unproven and sometimes based on unrealistic
reliant on one funding source, and without the assumptions. Donors should treat with healthy
26
Giving in India I Developing a framework
scepticism anyone who claims they have NGOs. Even within states, NGOs are often
achieved scale, sustainability and impact. Most grouped in certain districts. A USAID study
organisations are working towards this, but still of Jharkhand health NGOs found that 80%
need subsidy. of them were found in just under half of the
districts of the state.30
Lack of specialisation in NGOs can make it
challenging for a donor to identify NGOs that The UK Department for International It is one of the
have a distinctive expertise in a particular Department (DFID) has just finished funding
area. NGO activities tend to focus on a similar a five-year programme—Poorest Areas Civil
paradoxes of
set of topics: children’s education, livelihood Society—to promote civil society organisations poverty that
development, HIV/AIDS work and microfinance across 100 of the poorest districts in India. It is
have all been identified as areas with thriving currently tendering for the next five-year phase the higher
NGO sectors. of the project. the need, the
Many of the big names of the Indian NGO As well as building up NGO capacity in these harder it proves
sector work in children’s education—such as areas, successful NGOs from other areas of
Pratham, Children in Need Institute (CINI), India are opening new regional offices. The Aga
to find effective
Akansha and AID India. In contrast, donors Khan Rural Support Programme India, which organisations to
may find it harder to identify a deep pool of is based in Gujarat, has just opened a new
work with.
In the late 1990s, UNICEF drew attention to Yet an interesting recent development is the
the lack of education provision in urban slums, success of high-level ‘rights based’ campaigns,
and highlighted the work of Bodh Shiksha often complementing community mobilisation
Samiti, a Jaipur-based NGO, as one of the on the ground. These focus on establishing
few organisations working in the area. In 1998, legal rights through the court system, which
Bodh helped set up a National Core Group on will influence and monitor government action. One of the
urban education to help stimulate further work In Rajasthan, the MKSS movement started a
in the area. campaign in 1989 to increase transparency in
most surprising
The structure of the voluntary sector also
government records and expose corruption. things observed
This culminated in a ruling from the Supreme
reflects other geographical factors, with
Court in 2004 that forced the Central
by NPC and
NGOs heavily concentrated within certain
states and districts. As a general rule, states
Government to pass a Right to Information Copal during
Bill. Similarly, The Right to Food Campaign run
in southern India, such as Tamil Nadu, Kerala
by a coalition of NGOs led to an order from our research
and Karnataka, have a much more vibrant civil
society and NGO sector. Conversely, it is in
the Supreme Court for all primary schools to has been the
provide midday meals.
the central and eastern states, such as Bihar, highs and
Madhya Pradesh, Uttar Pradesh and Orissa, Management and governance
where fewer NGOs are operating. lows of NGO
One of the most surprising things observed by
This distribution presents a conundrum to NPC and Copal during our research has been management
donors. Many major professional funders, such the highs and lows of NGO management and and governance.
as the World Bank and Oxfam, have begun to governance.
redirect their funding towards the north.
Taking governance first, little official regulation
It is one of the paradoxes of poverty that exists for NGOs in India. Registration requires
the higher the need, the harder it proves to basic financial information and information
find effective organisations to work with. In on activities. Only two states, Gujarat and
many cases, it first requires long-term funding Maharashtra, have charity commissioners to
and support to develop the capabilities of
27
Giving in India I Developing a framework
oversee the sector—and these are overworked UK as inadequate separation of oversight and
and largely administrative. As outlined above, management functions. The advantages of
the Credibility Alliance has developed a set of having the same people sitting on the board
voluntary governance norms, but take-up is still and running an organisation is alignment: it can
at an early stage. be easy for NGOs to make decisions quickly.
The downside is lack of independent scrutiny
When looking at the governance of NGOs, the and the risk of ‘group-think’.
main detail for donors to be aware of is the
A common split between trusts, societies and Section 25 In addition to problems with the structure of
companies (ie, nonprofit companies). These are governance, the other interesting feature of
feature in the set out in Box 9. Trusts are traditionally set up Indian NGOs is the quality of governance.
sector is the when property is involved, such as land or a Boards meet infrequently—roughly two or three
building, and governed by a small set of people times a year—and often have a narrow skill
role of the chosen by the founder—often families—who set, with little financial, legal or management
inspirational then tend to sit for life. Societies have a experience.
governing board made up of members elected
founder or chief by a general body, which is renewed at certain A common feature in the sector is the role of the
inspirational founder or chief executive. These
executive. intervals. Section 25 companies are run in a
are charismatic individuals who have built up
similar vein to societies.
an organisation and continue to fill most of its
Trusts tend to be more secular in approach main functions. Often this masks a weak senior
than societies. Both are characterised by heavy management team, and an over-reliance on
overlap in staff and what might be seen in the
• produce benefits for others, generally outside the membership of the organisation; and
• be ‘nonprofit-making’.
Yet, to complicate the issue, nonprofit organisations can be registered under three different sets of legislation:
Each of these groups have slightly different organisational requirements that need to be satisfied.
28
Giving in India I Developing a framework
the chief executive. It can lead to over-work, which charities to support. Often weaknesses
bottlenecks, and instability when he or she steps in senior management or staff recruitment are
down. Despite this, only a small proportion of not immediately apparent, even while they pose
NGOs appear to have thought about succession significant challenges to the sustainability of the
plans. Following the Indian tradition of family-run organisation and its results.
businesses, some NGOs have near-dynastic
succession. Others make no preparation at Secondly, donors should be aware that one
all. This is something that donors should pay of the main reasons for poor organisational
close attention to—especially where making capacity is low spending on central
large grants. administration. Some donors pick NGOs on
the basis of their administration expenses,
Lack of depth of management and little but NPC and Copal believe that this kind
planning for succession reflects a wider of approach is simplistic and can actually
structural challenge in Indian NGOs—a general undermine effectiveness. Sometimes, counter-
weakness of central functions. They rarely have intuitively, the best way of improving the
adequate HR, administration or fundraising lives of the people NGOs work with can be
teams. This is partly due to a concentration of to make the organisation increase spending
project funding and a lack of prioritisation by on itself. Donors can directly fund an NGO’s
management. But it also reflects the priorities of central costs, or at the very least ensure that
* Dasra is a Mumbai-based organisation that works with Indian NGOs to maximise their efficiency, scale and impact. 29
Giving in India I Developing a framework
Activities
Where does this leave us?
• What is the problem that you are trying to tackle?
• How will the different activities you are carrying out address it? This section has sketched out a possible
analytical framework that can help
• What about elements of the problem that you are not addressing? To what
philanthropists start to think about how to
extent are you working with other organisations to fill those gaps?
allocate funding. It began by touching on:
• How coherent are your activities? Are they greater than the sum of their
parts? What are the links between them? • donors’ interests and passions;
• Which social groups are you reaching? Which are you not reaching? • donors’ resources; and
• How does what you are doing fit in with government services? • where funds can have an impact.
31
Giving in India I Water and sanitation
The importance of water, sanitation A final area to think about, again sometimes
and hygiene overlooked by donors, is the broader cost of
inadequate water and sanitation to dignity,
Most people recognise the need for clean security and equity. Often it is these issues that
water and sanitation, yet donors do not always are most relevant to people without access
appreciate how vital it is for a broad spectrum to water and sanitation themselves. Without
We shall of other outcomes. Analysis suggests that toilets, women have to wait until early morning
not finally improving water, sanitation and hygiene leads or evening to defaecate in the fields, which is
to better health, reduced poverty, increased inconvenient and leaves them vulnerable to
defeat AIDS, education and—more surprisingly—greater attack.
tuberculosis, security and equality.
What this analysis seeks to do is disprove
malaria, or any The World Health Organization (WHO) estimates the charge that water and sanitation is a
that every US$1 spent on improving water and peripheral issue. Instead, it demonstrates that
of the other hygiene leads to a return of between US$5 (£3) it is both important in its own right, and also
infectious and US$11 (£7).36 The WHO also found that strongly related to other more mainstream
water, sanitation and hygiene problems cause concerns, such as education and poverty. The
diseases that almost 10% of India’s disease burdens.37 This is potential impact of successfully addressing
water, sanitation and hygiene disadvantage is
plague the due to the effects of contamination from heavy
considerable.
metals, such as arsenic and fluoride, as well
developing as the more pedestrian but potentially deadly
Water, sanitation and hygiene needs
world until we matter of the impact of bacterial and faecal
material. Diarrhoea is the second biggest killer in India
have also won of children under five in India and contributes
to the country’s widescale malnutrition rates, At first glance, a donor would be forgiven
the battle for with almost half of Indian under-threes being for thinking that the situation on water and
safe drinking underweight.38, 4 sanitation in India is reasonably promising.
In 2004, according to government statistics,
water, sanitation Poor sanitation and stagnant water helps 95% of all rural habitations and 91% of urban
spread diseases like cholera and malaria
and basic health and, particularly in overcrowded city slums,
households had access to safe water.39, 40 And
although the numbers for sanitation had not
care. contaminates drinking water. Without water reached those heights, figures have doubled
to bathe with, people develop skin and eye over the past eight years.41
Kofi Annan35 infections and women can face gyneacological
problems. However, dig beneath the headline figures and
a more disturbing reality emerges. The main
How, though, does inadequate water and government numbers only capture ‘coverage’—
sanitation link to poverty? One route is through that is whether a village has a well, a slum
its effects on health, with money diverted to has a standpipe, or a house has a toilet. Key
medical expenses, even as illness stops people questions are not captured in this data, such as:
from working or children from attending school.
But it has even more direct effects. When • whether an individual gets reliable,
water is not available, people have to rely on sustainable and good quality water;
expensive alternatives, such as bottled water,
• whether toilets are actually used; or
which take up a disproportionate proportion
of their income. Where water is available, • if hygiene practices improve.
the simple matter of the time it takes for
Adequate data giving a clear picture in each of
people (typically women) to collect it has an
these areas across India does not exist. Pulling
opportunity cost in relation to work, family care
What this or education. Water collection can take up to
together different pieces of research, it appears
that there are still major gaps. The following
analysis seeks four hours a day.
analysis picks apart the sector according to
issue, group and geography. Only by looking
to do is disprove The effects on education go beyond
at these areas in more detail can a donor get
absenteeism from school and low enrolment.
the charge Lack of toilets, facilities to dispose sanitary a clearer idea of relative levels of need and
possible priorities for funding.
that water and pads and privacy constitute a significant
barrier to girls continuing in education beyond
sanitation is a adolescence.
peripheral issue.
32
Giving in India I Water and sanitation
* Fully-covered means that each person has access to 40 litres per day; and that the water source should exist within 1.6km in the plains and 100m elevation in hilly areas.53
33
Giving in India I Water and sanitation
The key message here is that access to water Why do people with access to toilets fail to use
is not the end of the story. It is tempting for a them? There is no single answer. One reason
donor to consider that funding water provision is poor quality design and a lack of water for
is enough, without thinking about its quality. cleansing. Another is inadequate understanding
Or to assume that people who already have of the benefits. There is also an important
access to water have no problems in this area. dimension of cultural opposition. Many people
Yet without dealing with quality issues, people are simply not used to it—they feel that having
will continue to suffer major health problems. a toilet in or near the house is unhygienic or that
The state of they should continue their ancestral practices.
Sanitation
Andhra Pradesh In some cases, social rituals have grown up
around female group defaecation.
has built nearly The second issue of need after water is
sanitation. In 2002, almost a sixth of all people These cultural factors are often overlooked
three million in the world without access to sanitation lived by donors—particularly those that dismiss
household in India.34 A major government push has helped
improve this situation. In 2008, the government
traditional practices as irrational or anti-modern.
However, tradition and social mores can have
toilets since estimated that 57% of rural households in India a significant impact on actual behaviour and
had access to a toilet—compared to 22% in
2001, yet it is 2001.41
the success of different interventions. Any
sector analysis has to integrate this ‘softer’
estimated that background into a proper understanding of
Yet this still leaves a vast number of people
the issue.
half remain without access to a toilet—43% of Indian
unused or are households corresponds to hundreds of millions
of people. Moreover, the total number of people
Poor hygiene behaviour
being used for with poor sanitation is likely to be much higher The third key issue highlighted by this analysis of
than the numbers without access to toilets, water and sanitation needs is hygiene behaviour.
purposes other since toilets often go unused. For donors this is probably the most overlooked
than sanitation. and least understood aspect of water and
In Himachal Pradesh, over 300,000 toilets sanitation. Yet it also has major potential for
were built in the 1990s, but an evaluation of impact. Numerous studies show that hand-
Water and Sanitation
a random sample in 2003 showed usage of washing is a simple and cheap method of
Program51
less than 30%. In Maharashtra, of the 1.6 million dramatically cutting down the spread of disease.
toilets constructed during 1997 to 2000, only
47% were being used.51 The state of Andhra Part of the challenge is establishing the
Pradesh has built nearly three million household current situation, in that hygienic behaviour is
toilets since 2001, yet it is estimated that half not straightforward to measure. Some of the
remain unused or are being used for purposes available studies appear to record unrealistically
other than sanitation.51 high levels of compliance. For instance, a study
by the Global Hygiene Council found that 13%
of people in India do not wash their hands after
using the toilet, and that 18% do not wash their
hands before eating food.52, 53 Experts believe
that the real proportions are higher than this.
34
Giving in India I Water and sanitation
All the evidence that NPC and Copal have seen Scheduled castes and tribes
suggests that the need for improved hygiene is
vital. Due to the high impact of diseases, such The 2001 census found that members of
as diarrhoea, any efforts to prevent them have scheduled castes are twice as likely to lack a
significant repercussions and can be highly cost- household water connection, compared to the
effective. As quoted in Chapter 1, analysis carried general population. Only 17% of scheduled
out for CIFF showed that successful interventions tribes have a toilet in their house, which is well
tackling poor hygiene cost US$3.35 (£2) per below the general figure of 43%.54
DALY, compared to US$94 (£57) for a pump.24 For donors
This is partly due to higher levels of poverty
and poor education among these groups but interested in
Needs by group
entrenched social, political and economic focusing on
discrimination is also a factor. A study of
Of course problems can be broken down
11 states found that in nearly half of villages, a group, it is
in different ways, and many donors thinking
about water and sanitation will want to target
people from scheduled castes were denied
water by other ‘higher’ castes.54 Children were
hard to think
resources on the groups that are worst affected.
At a very basic level, the main indicator of poor
unable to use water vessels in schools because of a more
of ‘purity’ issues; while households were made
access to water and sanitation services is
to wait until last before drawing water from
disadvantaged
poverty. Those on lower incomes are less likely
to live in areas with good infrastructure, less
the well. and troubling
able to influence public spending, and have Particular sub-castes are often trapped by segment than
less money to improve their situation by buying
storage tanks, bathrooms or purifiers.
tradition and social pressure into a practice known
as manual scavenging—in effect, collecting
communities
human excreta for a living. Manual scavengers are engaged in
Women
35
Giving in India I Water and sanitation
36
Giving in India I Water and sanitation
Particular states are worst affected are considered to be ‘developed’, there are
individual districts that have acute problems.
Individual states face their own distinct NPC has heard worries from some experts
environmental issues. For example, Rajasthan that needy districts in states such as West
has 10% of the surface area of India, but only Bengal and Andhra Pradesh are now getting
1% of its surface water, and Andhra Pradesh overlooked by funders.
has almost no groundwater left.58, 59 Yet donors
should bear in mind that these are not just Urban versus rural
‘facts of nature’, but are part of wider political, Unsurprisingly,
economic and social decisions. The other way of analysing need geographically,
already touched on above, is through the states with
Contrary to India’s stereotype as a ‘hot’ country, separating urban and rural issues. the weakest
the problem it faces at the moment is not
primarily one of inadequate water full stop. In terms of sheer numbers, India is indicators
predominantly a rural country, with the 2001
Rainfall is high, groundwater has historically
been strong, and India contains a number of census showing that 72% of the Indian tend to be the
perennial rivers. Rather, not enough has been population live in the countryside.61 And eastern and
done to protect and augment water resources. 28.3% of the rural population was in poverty,
Instead, groundwater is diverted to agricultural compared to 25.7% of the urban population.62 central states—
production; rainwater is allowed to run out This is reflected in much lower headline water Orissa, Uttar
to the sea; and surface water has become and sanitation statistics, as well as a host
contaminated by pollutants. of other problems including literacy rates, Pradesh, Bihar,
Table 3 sets out data from the National Family
education levels and poor health.
Jharkhand
Health Survey (2005/2006), which breaks But while rural disadvantage has been the and Madhya
These eastern and central states also tend to Already, urban infrastructure is under strain,
do badly in other areas, such as education and with many cities struggling to supply water and
health. In a 2003 review of the least developed remove waste in densely populated areas. As
districts in India, 65 of the worst 69 were found noted above, the brunt of the burden is felt by
in the five states mentioned above.60 This people in slums—particularly those who are
reflects a range of factors including weak state ‘unofficial’ and therefore considered largely
government, an underdeveloped civil society, outside of government responsibility. They are
and low economic development. also particularly vulnerable to outbreaks of
diseases, such as cholera or dengue fever.
This can be frustrating for donors who want to
focus on high need areas, as it makes it harder So on both counts—numbers affected and
for funding to have an impact. Compared to degree of need—urban issues are gaining While rural
richer states, fewer effective NGOs are in place, importance, and due to demographic shifts, this
existing systems are weak and government is expected to continue. Focusing attention on disadvantage
cities now can help head off problems in the
has lower capacity. Expectations often have to
future.
has been the
be scaled back, both in terms of impact and
timescales. traditional focus
Stage 2: What works? of government
So, while evidence of need would suggest
that funding should be directed to northern Having looked at the nature and levels of need and funders,
states, it will also require more in-depth due in the sector, the next stage of analysis is to
diligence of NGOs and their capacity, as well see what can be done about it. By identifying
there is a growing
as possibly more hands-on support. One approaches and interventions that have a argument for
way for an individual donor to surmount this strong evidence base, it is possible to direct
is by channeling funding through foundations donors to areas with potentially high impact. increasing the
or INGOs with established infrastructure and
contacts in these states.
Thinking about what works can also provide focus on urban
criteria for donors to judge current activity in the
sector, and see how closely government, NGO issues.
However, while it is useful to make wider
or private sector activity reflects good practice.
comparisons between states, there are dangers
in being too dogmatic. Even within states that
* Due to difficulties and inconsistencies in data collection, there are some anomalies. Apparently over 90% of households in Bihar and Uttar Pradesh have access to
improved sources of drinking water, yet this is inconsistent with other sources of data. Information in the same NFHS-3 survey states that these two areas have the
lowest percentage of households connected to piped water supply.
37
Giving in India I Water and sanitation
institutions is a It is important to bear in mind however that There is an opportunity for an ‘engaged’
donor to support research here into better
central theme not all interventions will address all of these
approaches. This is likely to involve working
five areas at once; many will focus on a
to all Indian particular element. Covering all of these five closely with communities, health experts and
local government.
development disparate areas can be challenging for a single
organisation. An NGO that knows how to
A final area of education and information is
work, because work with communities does not necessarily
community mobilisation and empowerment.
have technological or financial expertise.
they are Likewise, government departments may
This can sometimes sound woolly to donors.
Yet it is pivotal in terms of ensuring that people
critical to have technological knowledge, but no clear
know their rights and have the confidence to
knowledge of environmental considerations.
enforcing state Partnership working is often key.
do something about enforcing them. Often
people are unaware of the legal responsibilities
and central The key lesson for a donors is that, even of government or municipal utilities, and
government when looking at an individual intervention that do not know how to hold them to account.
is focused at a particular component, it is Supporting community ‘empowerment’ is a
accountability. important to see it within this wider context. way of potentially leveraging wider resources.
Weaknesses in any one area may undermine For example, women’s self-help groups can be
the overall impact. So, while a project may encouraged to run community toilet complexes,
educate and inform the community about or to provide microfinance facilities for sanitation
sanitation, if the money is not there, or if local hardware. This relates closely to the next
institutions are not involved, its effectiveness will component of good water and sanitation—local
be seriously weakened. institutions.
38
Giving in India I Water and sanitation
Choice
39
Giving in India I Water and sanitation
own needs and The amount of freshwater available per person Sustainability is an important theme linking the
in India is declining rapidly, and it is predicted components—whether talking about financial
also the wider that by 2020, India will be a water-scarce models, technology, education and information,
impact they country—which means that there will be less environment or local institutions.
than 1,000 cubic metres per head.66 This
have on the is exacerbated by significant seasonal and Associated with the idea of sustainability is the
need to tailor initiatives and approaches to the local
behaviour of geographic disparity. Some areas of Rajasthan
context. External systems that are parachuted in
get an average of just 150–300mm of rain a
their husbands year, while floods plague regions such as Bihar without proper consultation, and without input from
communities and the people that are actually using
and children. and Orissa.67 Half of India’s annual precipitation
them, are unlikely to last or work.
occurs in 15 days, and 90% of annual river run-
off occurs in a four-month period.66
40
Giving in India I Water and sanitation
Table 4: A matrix showing examples of the interaction between the components and qualities of successful water, sanitation
and hygiene interventions
* The government body that sets the framework for India’s economic development through a series of five-year plans.
42
Giving in India I Water and sanitation
The recent announcement of a new National Urban Sanitation Policy in October 2008 might be the start of greater government
focus on urban issues, but the exact details of the strategy are still unclear. The initial policy outline seems to be based on the
rural Total Sanitation Campaign, with an emphasis on awareness generation, operation and maintenance, and establishing open
defaecation-free cities.71 While it is still too early to say for sure, the programme’s development may provide interesting opportunities
for philanthropists.
The government approach to urban water supply has traditionally been about building up the necessary infrastructure, and less
about running it successfully. Although water and sanitation spending makes up most of the main government infrastructure funding
projects, Indian water and sanitation utilities are, as already noted, regularly rated as the worst in Asia. Water supply is unreliable and
insufficient for people’s requirements, and it does not reach those in most need. This is partly due to problems raising revenue and
partly due to poor management of the services.
In 2007, only a third of urban utilities were able to recover their operating costs. A key reason for this is that they undercharge for
water. Some utilities, such as the one serving Kolkata, do not bill residential users at all.72 Others keep prices artificially low. For a
family of five living on the poverty line and using 20 cubic metres of water a month (which is the international standard—roughly
ten bathtubs), it would cost 1–2% of average income. Affordability thresholds developed by the WHO suggest that 5% is a more
appropriate figure.73
What can be done about it? Efficiency improvement is one answer—reforming and retraining public utilities to overcome high-staffing
Charging more for water is a vexed topic but there is some survey data to suggest that even poor Indian families would be willing to
pay more for a better service.74 However, urban governments are worried about alienating voters, as well as the danger that rising
costs would penalise the very poor.
Donor sympathies may also be divided here. On the one hand, it does seem that access to water is a basic human right that should
be subsidised by government. Yet on the other, excessively low costs mean that in reality water supply in urban areas is unstable
and low quality. Also, it appears that the bulk of government subsidies do not go to poor families, but instead go to companies that
use high volumes of water at reduced tarriffs.73 The 40% of people without any access to water from utilities get nothing.
In truth, unless a donor has millions at their disposal, their own utility company, or wants to fund a particularly focused advocacy
group, utility reform is not going to be easy to engage with. Beyond, that is, getting a clearer idea of the context and challenges
facing urban NGOs. Moreover, there is a strong argument (often made against the World Bank) that overseas donors should not
have such a strong role in influencing urban water policy.
By contrast, an interesting recent development has been a growing trend to involve local communities in government’s decision-
making around urban water and sanitation. It is important not to overstress this; in the main, decisions are made at state level, or by
public utilities where local people cannot hold people to account or communicate their preferences. However, interesting initiatives
are being explored by municipal corporations to listen and to involve local groups in planning and delivering services. In some cities,
local groups have been able to persuade local government to extend water and sanitation infrastructure into unofficial urban slums.
National sanitation policies took the same Over the 1990s, there was a growing realisation
approach, although starting somewhat later. that these approaches were not working. In
From 1986, the Central Rural Sanitation response, a number of pilot projects were
Programme (CRSP) provided a 100% subsidy developed such as the Swajal project in Uttar
of Rs.2,000 (£25) to families below the poverty Pradesh and the Intensive Sanitation project in
line to construct toilets but, again, community West Bengal.75, 76 These were designed to test
participation was low. Toilets were built without out different ways of stimulating community
any attempts to persuade people to use them, demand and improving sustainability. Their
to educate communities on the benefits of success led to a change in government
sanitation, or to teach people how to operate approaches and policy in regards to rural
and maintain them. provision; innovation in urban water policy has
lagged behind. While the focus of this section
is on rural government policy, Box 11 sets out
current progress with urban policy.
43
Giving in India I Water and sanitation
The Total Sanitation Campaign started as a pilot project in 1999, and has since grown to be the government’s major programme in
the area of sanitation. It covers 590 of the 610 districts of India.41 In 2007/2008, the budget for the programme was US$235.56m
(£143m).77 Its scale and importance mean that any donor visiting water and sanitation projects will need to know about it.
This is not least because its design incorporates some of the lessons of earlier policy failure. Although the scheme has evolved
slightly over the years, its core principles include that it is community-led, focused on information, education and communication
(IEC) activities, and involves minimum subsidies. Funding is meant to go to developing a supply chain of technology that can provide
a flexible menu of options rather than a ‘one size fits all’ approach.
Central government provides most of the money, but individual states have been able to adapt and experiment with the
programme.75 In Maharashtra, for instance, the government has pursued a ‘community-led total sanitation’ approach that has
broadened the focus beyond individual toilets, and concentrated on making villages ‘open defaecation-free zones’. Cash prizes were
awarded to successful villages.
This community-focused approach is now at the centre of a lot of sanitation thinking. Central government itself backed ‘open
defaecation-free’ zones in 2003, when it started the Nirmal Gram Puraskar (‘Clean Village Award’). Under this scheme, cash
incentives are given for panchayats, blocks and districts that are fully sanitised. As of October 2008, the TSC has supported the
building of 57 million household toilets, 680,000 school toilets, and 200,000 anganwadi (nursery) toilets.41
Swajaldhara
On water supply, the main programme that donors should know about is called Swajaldhara, which makes up 20% of the
government’s main funding stream—the Accelerated Rural Water Supply Programme (ARWSP). Started in 2002, it is a significant
improvement over its forebears. Key principles include that it is:
• Demand-driven: Communities decide on the choice of the drinking water scheme including planning, design, implementation,
control of finances and management arrangements.
• Community contribution-based: Communities have to share costs (initially 10%) and pay 100% of operation and maintenance costs.
• Water conservation focused: Projects should include groundwater recharge systems and rainwater harvesting.
An interesting feature of the programme is that government intervention is staggered, from initial funding for community mobilisation,
to a two-tier payment system for implementation, with final authorisation coming from central government. Overall the aim of the
programme is ‘shifting the role of government from direct service delivery to that of planning, policy formulation, monitoring and
evaluation, and partial financial support’.78
A third policy development that will inform donor practice and influence resource allocation is the National Rural Drinking Water
Quality Monitoring and Surveillance Programme. This was started in February 2006 and now makes up 20% of the government’s
water budget.
Under the programme, the importance of quality issues is spread through information and education activities. Local communities are
meant to be given kits to test the quality of their water sources; positive samples are then tested at district and state levels.79 The idea
is that by making water contamination better known and more visible, it will help create demand among the populace for cleaner water,
increase the pressure on government and water suppliers to improve services, and encourage safe practices like boiling.
44
Giving in India I Water and sanitation
Second, due to the focus on community to oversee the TSC programme.82 Yet, as
involvement and information, education and shown above with Andhra Pradesh, there
communication, government is starting to are also many examples where government
involve and fund NGOs to deliver parts of its unsuccessfully tries to deliver on its own.
programme. This provides opportunities for
philanthropists to provide match funding or to Lack of proper decentralisation
fund joint programmes. The second major problem, the lack of proper
decentralisation, is both a product and a cause
And third, despite improvements in government
of constrained government capacity. It can be
The lack
policy, significant weaknesses still exist—
particularly around implementation and
easier and quicker to run things from the centre, of proper
or just to ignore the requirements for community
community involvement. These challenges
involvement. A government review of its policies decentralisation
tend to remain across most government
activity in India. Getting a clear idea of exactly
stated that: is both a product
how this affects how government policy ‘While our programmes have elaborate and a cause
translates into reality is a key role for analysis. guidelines for community involvement, it is
Only by understanding this are donors able obvious that field-level adoption is far from
of constrained
to identify opportunities where they can make satisfactory.’40 government
improvements, strengthening existing resources
and filling in any gaps. It is these challenges and In a study of 1,700 rural piped water schemes, capacity.
problems that we will look at next. less than a third were actually managed by
the villages themselves.83 Even when the local
Current challenges community has been involved, disadvantaged
groups remain overlooked. In villages in
Lack of government capacity
45
Giving in India I Water and sanitation
46
Giving in India I Water and sanitation
During our research, NPC and Copal visited Multilateral and bilateral agencies
one specialist water microfinance provider.
Its ideas were interesting, but the model was Looking globally, US$6.2bn (£3.8bn) or 7% of
underdeveloped, with limited deal flow and all aid directed through multilateral and bilateral
inadequate capital to grow. Donors wanting to agencies goes to the water and sanitation
operate in this area should recognise it is a high- sector. India gets more of this money than any
potential but high-risk option at the moment. other country—receiving 13% of the total. Most
of this came from Japan (US$635m/£385m),
Elsewhere, work is being done to develop the World Bank (US$130m/£79m) and the The main trend in
and improve the market in water hardware European Union (US$47m/£28m).86
and sanitation and hygiene supplies. The
the development
government’s Total Sanitation Campaign, These big sums are largely in the form of of government
described above, calls for the development interest-free loans for major infrastructure
of rural sanitary marts (basically, local supply projects, such as the Bangalore Water Supply policy over the
shops) that would be run by self-help groups, System, or to augment state strategies. The
EU is funding the Rajasthan State Government
past decade has
NGOs or local government. UNICEF also
funded a programme in Bihar to encourage, €80m (£69m) over three years to strengthen been the shift
water supplies across the state.
train and support masons in sanitation—both in towards initiatives
terms of construction techniques and marketing
their products.
Funding is also directed to NGOs, particularly by that stimulate
the small bilateral agencies that are no longer able
The development of social enterprises, with to direct government-to-government support. local demand.
avowedly social aims, provides opportunities
for philanthropists to contribute financial and
International Non-Governmental
non-financial resources. This has also enabled
Organisations (INGOs)
47
Giving in India I Water and sanitation
Corporates, Trusts and Foundations When NPC and Copal analyse voluntary sectors and
individual NGOs we concentrate on four main areas:
Trusts and foundations can be divided into
two main groups—those that fund water and • activities;
sanitation as part of their general programmes, • results;
and those with a specific focus. The bulk tends
• management and leadership; and
to be in the first group—including established
players such as the Tata Foundations, the Ford • finances.
The new wave Foundation and the Michael and Susan Dell
Comprehensive data on these areas is limited,
Foundation. Often funding spans both drinking
of business water and general water management, such as
both for individual NGOs and, in particular, for
the sector as a whole. Yet NPC and Copal’s
philanthropists— irrigation and groundwater.
research into a spectrum of individual NGOs
such as CIFF, The new wave of business philanthropists—
has highlighted some general observations that
can usefully inform funding.
the Bill and such as CIFF, the Bill and Melinda Gates
Foundation and the Acumen Fund have
Melinda Gates also started to look more closely at the 1. Activities
sector. This is partly because of the level of
Foundation and need, but also because of possibilities for The first main area that NPC and Copal look at
the Acumen expansion, replication and scalability. Increased is activities. This involves getting to grips with
what NGOs, as a whole, actually do within the
government commitments, and the potential for
Fund have also community and individual contributions, provide water and sanitation sector.
The final area of analysis is the structure of the • developing pilot projects;
voluntary sector. This matters primarily because • strengthening the structure of the sector;
NGOs remain the central ‘unit of action’ for
philanthropists, despite growing interest in • and lobbying and campaigning.
A donor looking quasi-market approaches. Many NGOs in the sector work across these
for a range of Where effective NGOs do not exist in a certain
different areas, but we will consider each of
these activities in turn below.
specialist water area, it limits a funder’s ability to act. Likewise,
donors benefit from a clearer understanding of The first area, community work, has been
and sanitation the features of the sector and the challenges the traditional focus and strength of NGOs in
that NGOs often face, as it can help improve
NGOs in India the effectiveness of their funding. This is
this sector. Utthan was founded in 1981 in
the Bhal district of Gujarat, one of the poorest
is likely to be relevant both in terms of choosing which areas in the state. Its aim was to work with
organisations to fund, and also in improving the
disappointed. quality of their funding.
disadvantaged communities, (particularly
women) and it soon started to focus on water
and sanitation, major issues in the drought-
prone region. In 1991, it carried out a survey
of needs in Gujarat and highlighted three other
districts where it thought its expertise working
with communities would have most impact.
48
Giving in India I Water and sanitation
Its first major project was working with village In some cases, NGOs lack the necessary
communities to help establish specialist water technological skills. Employing properly trained
and sanitation sub-committees—pani samitis. engineers can be expensive, and staying on top
These would help coordinate local services, of technological advances is time consuming.
interact with government and help to collect In certain cases, the benefits of water and
fees for the operation and maintenance of local sanitation projects are jeopardised by shoddy
water systems. The success of this project implementation—poorly constructed latrines will
led the state government to make pani samitis pipe sewage directly into drinking water sources.
mandatory in each village. In 2009, the Minister
in charge of rural drinking water sent a letter to The Aga Khan Rural Support Programme
each state water board to encourage them to India (AKRSPI) is one of the largest NGOs
form pani samitis in their area. in the north west of India, with an income of
Rs.180m (£2.3m) and activities that stretch from
The bulk of Utthan’s current work is building up Gujarat to Bihar. It works across drinking water,
the capacity of these pani samitis, to ensure more general water resource management
they have the necessary skills, motivation and and livelihood promotion. Its activities rely on
knowledge to carry out their responsibilities. a stable of engineers and technicians, with
It currently supports around 400 villages, as specialist knowledge of water projects. It
well as running the People’s Learning Centre currently helps 35 villages to construct water
on water and sanitation, which produces and supply systems as part of the government’s
disseminates literature on topics such as good Swajaldhara funding project. This involves
hygiene practices and the impact of unsafe constructing check dams, digging wells and
drinking water. It has recently run intensive building water delivery systems.
awareness activities on ‘ecosan’ toilets, a
One of AKRSPI’s innovations is the design of
The history of the sector has seen a general One of the things this has helped to track is
movement from community mobilisation and the decline of water quality from the source. So
education to the direct implementation of while the water may be relatively clean when
programmes and projects, the second group drawn from the well, it becomes progressively
in our typology. Although this can ensure proper contaminated by poor hygiene practice as
community participation in the design and it is carried into the household, stored and
construction of water and sanitation systems, then consumed. AKRSPI is now developing a
progress is not always smooth. programme focused on hygiene promotion.
49
Giving in India I Water and sanitation
The largest sanitation charity in India is Sulabh Gramalaya, based in the city of Trichy in
International, which runs 7,500 toilet and Tamil Nadu, has developed a model where
bathroom complexes across India catering for community toilets in slums are run by female
ten million people each day. It also provides self-help groups. While the city corporation
cleaning for hospitals, schools and major provides the facilities, and in some cases water
public events. Costs are covered through user and electricity, the self-help groups organise the
charges, and it receives no foreign philanthropy. operation and maintenance of the facility.
Sulabh also tackles the social prejudice and This includes installing child-friendly toilets,
economic disadvantage of manual scavengers. maintaining cleanliness and organising repairs.
It runs its own school and vocational centre, A small fee is charged to cover costs, with any
to train the children of scavengers and help surplus either going to develop community
integrate them within the general population. assets—such as community halls and rainwater
It also raises awareness of the situation of harvesting schemes—or into a central fund.
scavengers through media work and events. This fund is then used to subsidise facilities in
It recently ran a fashion show and organised a areas where they are unable to cover their costs
ceremony with the President of India. due to low usage or where local government
requires that they pay for electricity.
The third main activity for NGOs, beyond
working with communities and implementing The Naandi Foundation in Andhra Pradesh
projects, is developing pilot projects of new has established a model for providing purified
technological and financial models. water in areas of high contamination. In 2006,
it established Community Safe Water Schemes
In Orissa, the NGO Gram Vikas has developed (CSWS) in 25 villages that lacked access
a specific approach to help rural villages with to clean drinking water—reaching 12,500
their water and sanitation, and to strengthen households. Each CSWS involves establishing
their local governance practice. This involves a village water treatment plant where people
insisting that village committees sign up to a can get access to clean water for a small fee
stringent list of conditions before starting a (generally 10 paisa [0.001pence] per litre).
project, to ensure that provision is equitable,
sustainable and covers sanitation. The The model depends on coordination between
conditions include: three main partners:
• Everyone in the village has to sign up and • Panchayats provide a regular source of
contribute to the construction of pumps water, secure land, organise a community
and toilets. financial contribution and electricity.
• Women and all disadvantaged groups • The Naandi Foundation acts as project
have to be involved in decision-making manager and provides pre-financing for
and local committees. each project, as well as collecting user
fees. It raises awareness and carries out
• Communities have to agree to build high
measurement.
quality facilities, including piped water
to each house, and individual latrines • A private company, WaterHealth
and bathrooms. International, which is based in the US, has
established a new technology to purify water
• Communities have to establish a system
by UV rays—UVWaterworks™.
to pay for operations and maintenance—
for example, using community land for Following the success of the original project in
cashew farming. establishing sustainable schemes, the Naandi
Foundation has developed and expanded
• A corpus fund has to be established so that
its work. In response to a request from the
the interest can be used to subsidise new
Government of Punjab, it set up schemes in
households to connect to the system.
53 fluoride-affected villages during 2008 using
In return, villages receive Gram Vikas' support reverse osmosis technology supplied by Tata
in applying for government funding, its help Industries. Similar schemes were set up in
implementing the project, and also an extra 2009, in Haryana and Rajasthan. Over the next
subsidy on top of the community contribution two years, the Naandi Foundation hopes to
and government subsidy. reach 1.3 million people.
Although expansion is limited by the willingness The fourth area of activity for NGOs is in
of villages to accept the terms of the improving the structure and performance of
programme, this programme has spread to over the water and sanitation sector as a whole.
500 villages across Orissa. It has also worked
with other NGOs in Madhya Pradesh and Bihar One of the interesting developments of the last
to replicate the model, as well as further afield couple of years is the construction of various
in Tanzania. online networks and resources that NGOs,
government, academics and individuals can use
to share and disseminate information.
50
Giving in India I Water and sanitation
The Arghyam Foundation established the India In 2005, JBF organised a conference with other
Water Portal with funding from the National stakeholders and NGOs to discuss a shared
Knowledge Commission (a government council). approach to groundwater legislation, and water
This is a web-based platform to gather information resources more generally. This was followed
and resources about water, in order to share up by a workshop with state officials, and the
good practice and stimulate debate. It includes appointment of the foundation to the ‘Expert
a range of different materials, research and Committee for Integrated Development of Water
articles, resources to use in schools, and links to Resources’. This has produced a state water
organisations working in the field. In 2008, it also policy, which is currently being debated in the
established an online portal for sanitation. state legislative assembly. If it passes, it has
the potential to have a significant impact. It is
This complements the WES-Net group—set a strong example of the benefits that lobbying
up by the UN agencies and other major can produce.
stakeholders, and supported by Plan
International. Again, this shares information 2. Results
about training sessions, workshops and
events. With the help of WaterAid, it is aiming Having looked at their activities, the second
to lead and coordinate research in the sector, aspect of the voluntary sector to examine in
identifying gaps, building partnerships and detail is results, in particular the outcomes
minimising overlaps and unnecessary repetition. of individual NGOs. This chapter has already
spelled out general components and qualities
NPC and Copal have been surprised by the
of a successful intervention, to help donors to
lack of sharing and cooperation between
recognise what a well-designed intervention
NGOs in the field. Often organisations appear
looks like. However, this is not a substitute for
to concentrate only on their own work, and do
51
Giving in India I Water and sanitation
Staff issues are another common problem in There does seem to be a link between long-term
water and sanitation NGOs, both in retention secure funding and successful NGOs. Because
and recruitment. The focus on building strong NPC and Copal’s research has been focused
relationships with communities they work with on identifying examples of good practice, a
often leads to field staff living in isolated and disproportionate number of organisations we
uncomfortable communities. Staff from outside have visited have benefited from long-term
the community can find it hard to acclimatise funding relative to the rest of the sector.
and can leave after only a short time in post, at
great disruption to projects. In response, NGOs Our wider analysis of the sector suggests that
are increasingly hiring people from the areas they long-term funding is the exception to the rule.
work in. This has several other benefits, such as For most NGOs in the sector, funding can be
increasing local knowledge, building up the skills extremely short-term and precarious. Although
of local communities and overcoming suspicion. funding is often arranged for three-year periods,
this can be dependent on an annual review,
However, local recruits may not have a strong which makes it harder for NGOs to plan in
set of qualifications and skills, and will require advance, to offer security for their staff and to
training to come up to speed. Training budgets sustain projects.
and supervision are often inadequate.
As noted in Chapter 2, one response to the
A final issue is recruiting people in the first vagaries of funding flows is that NGOs are often
place. As mentioned in the previous section, focused on building up their corpus fund. This
pay is extremely low across the sector. This is effectively an endowment, similar to financial
makes it harder to recruit candidates at all levels reserves, yet the capital is not meant to be
of the organisation. The water and sanitation touched. Instead, the interest is used at the
sector is no exception. discretion of the charity.
54
Giving in India I Water and sanitation
It is NPC and Copal’s impression that this Moreover, the information and the data included
absence of a strong sector infrastructure leads above helps donors to put this analysis within
to considerable replication of work, as different the wider context of the voluntary sector—to
organisations ‘reinvent the wheel’ across India. see whether its experiences or attributes are
They miss out on research and lessons that exceptional or typical.
have been learned.
In a more practical way, this analysis also
Strengthening the capacity of the sector starts to suggest and to spell out ways for
as a whole could also help overcome funders to identify NGOs. There are numerous
organisational weaknesses. Shared HR or mechanisms to help identify NGOs, including
financial management support could help NGOs co-funding with other funders, working
struggling to maintain their central functions. through INGOs and intermediaries, and doing
Lobbying and campaigning work could also be independent research.
improved by working in networks and combining
and consolidating experiences and data. Working through other funders appears to
be a sensible way to donate—leveraging
Influencing government programmes— their existing infrastructure, knowledge and
and lobbying and helping community relationships. Particularly for donors with large
campaigns amounts of money but little time, co-funding
provides a way to share risk, magnify funding
Frustrating and unwieldy as it often proves to and minimise reporting requirements. Co-
be, government plays the key role in the sector, funders may bring to the table complementary
whether as service provider, funder or regulator. non-financial resources.
Influencing and improving the way it works has the
potential to reach millions of people across India. Yet finding other funders can be challenging, as
55
Giving in India I Water and sanitation
• the prioritisation of direct services at the NPC and Copal’s analysis found that the
expense of central costs; and amount of dissemination and knowledge
sharing between NGOs working in water and
• a lack of funding. sanitation is poor, and that NGOs’ activities are
It is this last point that appears to be the most isolated and cut off from each other. Project
telling factor, as NGOs reported receiving funding rarely covers disseminating and sharing
funding for specific projects, but without these lessons. These are often extra costs
covering the full cost of running central borne by charities themselves. Donors should
functions. rectify the situation.
NGOs find it hard to pay for training and Moreover, donors who are funding across
infrastructure. Yet by directing money to these multiple organisations to tackle the same issues
areas, a donor has the potential to improve the can help to organise networks and conferences
way an organisation runs, strengthen the quality to share lessons and experiences.
of its services and provide a basis for growth.
Taking a long-term view
Building the capacity of the organisation also
A final area is the question of timing. In the past,
involves focusing on staff resourcing issues.
funding has been weakened by a short-term
Raising salaries can help retain and recruit high
approach. Ad hoc funding does not necessarily
quality workers.
allow an organisation to establish and test a
In many cases of course, NGOs require more new model. Conversely, funding that goes on
than just financial assistance. For donors with for years without scrutiny of the relationship has
extra capabilities or contacts, there is potential the danger of making both parties complacent.
to use these resources directly to advise and NGOs are in particular danger if the relationship
support NGOs in developing their effectiveness. breaks down for any reason.
Funding impact measurement and Instead, donors should be aware of the length
evaluation of time necessary, and work out an exit plan—
what happens after their funding runs out. Is
Another core way of improving the quality the plan to get government to pay, to increase
of funding is to ensure that project funding community contributions, or to find other grant-
includes a component for monitoring and makers? These are important questions that
evaluation. A donor may also want to fund donors should be thinking about even before
internal monitoring systems directly. Doing this they start funding.
has considerable potential for maximising the
impact of funding.
56
Conclusions
This report aims to be a cross between a The remaining parts of this report tested the
manifesto, a toolkit for donors and an in-depth potential of this framework to provide useful
analysis of the water and sanitation sector. information and guidance for donors. It was
Underpinning it all is the argument that better applied to the Indian voluntary sector as a
analysis and research can help to improve the whole then, in Chapter 3, applied specifically
effectiveness of philanthropy in India. to the water and sanitation sector. This sought
to demonstrate how it is possible to analyse
In the first section of the report we explored a existing information to provide guidance and
key hypothesis—that philanthropy in India is not advice to philanthropists.
working as effectively as it could be. From the
available evidence, it appears that funding is Yet more work needs to be done
not being allocated to the greatest needs and
Alongside its sister report, Starting strong, this
that NGOs are not being chosen on the basis of
research is NPC and Copal’s initial contribution
their impact.
to the wider discussions of effectiveness in the
The chapter went on to build a theoretical Indian voluntary sector. More needs to be done
model of why this is the case, introducing the to explore and test some of the issues and
concept of a broken funding market: donors ideas raised. There is a lack of primary research
are not asking for information, charities are not on the nature and the scope of the voluntary
supplying it, and the flow of information is poor. sector in India, as well as analysis of social
issues and specific geographies.
The broken funding market provided the
context for exploring another of the report’s Both NPC and Copal are looking at ways to
hypotheses—that analysing social issues continue and develop discussions and initiatives
and individual NGOs offers a way to fix these to improve the effectiveness of the Indian
problems and improve the effectiveness of charitable sector, but for it really to work, we
philanthropy. Analysis helps donors to decide believe that this initiative should be taken on by a
three things: which issues to focus on; which coalition of India-based organisations. We hope
charities to support; and how to structure that this document can be a basis for action and
funding for greatest impact. provide the call to arms for philanthropists and
NGOs to develop this work further.
The second section of the report suggested
a potential analytical framework, derived from
NPC’s work in the UK. This is based on looking
at donors’ interests, resources and which
issues can be tackled. Deciding which issues
can be tackled has four stages of analysis:
needs; what works; the activity of other actors;
and the nature of the voluntary sector.
57
Acknowledgements
We are very grateful to the following individuals and their organisations for their input into
this report.
58
Giving in India I Acknowledgements
Additionally we are heavily indebted to the following individuals who provided us with valuable
input after taking the time and care to read the consultation version of this report:
59
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